What is an Endowment?
An endowment is a permanent fund. The gifts (also called the principal) are invested to last forever. Only the earnings are spent for charitable grants or distributions. The earnings from agency endowments are distributed back to the nonprofit.
Just as Albert Einstein once called compound interest “the most powerful force in the universe,” endowments carry an inherent power to provide for community needs through continued growth. Over time, the distributions exceed the original gift, while the fund balance continues to grow.
How Does It Work?
Agency endowments are invested to grow over time, and a portion of the earnings, as determined by our spending policy, is returned to your organization annually or allowed to grow if the nonprofit prefers saving the earnings for a later time. You now have a permanent source of community capital that will assist with financial stability now and forever.
- Determine the amount your organization would like to invest in an endowment.
- Meet with our staff to complete a fund agreement. The minimum is $10,000, however, we allow three years for an organization to build its fund to the minimum.
- Our staff members handle all the administrative and accounting details, while our Investment Committee ensures expert investment management, and oversight to assure that investment managers meet benchmarks.
- Your nonprofit organization has 24-hour, online access to your financial statements.
- Your donors can add to your endowment at any time in any amount. Your donors may also establish a separate designated endowment that benefits your organization. The Foundation can assist your donors in setting up this type of fund.
Have Questions? Contact Us for additional information or help!
